US stocks open lower as investors monitor Iran trensions
US stocks and oil fall in early trading; gold holds steady
(32 minutes later)
NEW YORK — Stocks are opening slightly lower on Wall Street as investors continue to closely monitor tensions between the U.S. and Iran. Oil prices gave up some of their recent big gains after a U.S. drone killed Iran’s top general. U.S. officials were bracing for Iran’s response to the killing. Gold touched its highest price in nearly seven years on Monday and was holding steady Tuesday. The S&P 500 fell 4 points, or 0.1%, to 3,241. The Dow Jones Industrial Average slipped 50 points, or 0.2%, to 28,653. Technology stocks bucked the downward trend. The Nasdaq edged up 11 points, or 0.1%, to 9,080.
NEW YORK — U.S. stocks fell in morning trading Tuesday and gold and crude oil prices took a pause from their recent run as investors wait for the next step in the increasingly tense U.S.-Iran confrontation.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Markets swung sharply toward caution following Friday’s U.S. killing of Iranian Gen. Qassem Soleimani, and the threat of war sent dollars flowing out of risky investments like stocks and into gold and other safer harbors. Crude oil also jumped on worries that violence in the Middle East could disrupt supplies.
Global stocks stabilized Tuesday and the price of oil edged off three-month highs, though investors remained cautious over rising tensions between the U.S. and Iran.
Asian and European stocks clawed back some of their losses from Monday, while benchmark U.S. crude oil was heading for its first drop in four days. Gold held steady a day after touching its highest price in nearly seven years.
U.S. officials were bracing for Iran’s response to the killing by a U.S. drone of its most powerful general, Qassem Soleimani. Noting heightened levels of military readiness in the country, Washington was preparing for a possible “tit-for-tat” attack on an American military leader.
U.S. stock indexes were lower, and more than twice as many stocks fell in the S&P 500 as rose. Oil companies had some of the biggest declines after falling crude prices dragged down Exxon Mobil, Chevron and others in the industry.
In Europe, Germany’s DAX advanced 0.8% to 13,231 while the CAC 40 in France climbed 0.3% to 6,033. Britain’s FTSE 100 edged 0.2% higher to 7,589. Futures for the S&P 500 and the Dow Jones Industrial Average were roughly unchanged.
KEEPING SCORE: The S&P 500 was down 0.4%, as of 9:55 a.m. Eastern time.
“The positive sentiment is likely to continue for the remainder of the day as the underlying drivers of the stock market rally, the search for yield and global economic recovery, reassert themselves,” Jeffrey Halley of Oanda said in a commentary. “Only geopolitical headlines surprises from the Middle East are now likely to derail the rally.”
The Dow Jones Industrial Average fell 119 points, or 0.4%, to 28,583, and the Nasdaq composite dropped 0.3%.
In Asia, most benchmarks rose, with Japan’s Nikkei 225 index adding 1.6% to 23,575.72. Hong Kong’s Hang Seng picked up 0.3% to 28,322.06, while the Shanghai Composite index gained 0.7% to 3,104.80. In South Korea, the Kospi rose 1% to 2,175.54. Australia’s S&P ASX 200 climbed 1.4% to 6,826.40. Shares fell 0.6% in Taiwan but rose in most of Southeast Asia.
MARKETS ABROAD: Asian markets had some of the day’s strongest gains and clawed back much of their sharp losses from Monday.
Gold was steady Tuesday after touching its highest price since April 2013 on Monday as investors sought safety amid fears the antagonisms could lead to war. It was down 10 cents at $1,568.70 per ounce.
Japan’s Nikkei 225 jumped 1.6%, South Korea’s Kospi rose 0.9% and Hong Kong’s Hang Seng added 0.3%.
Gold has historically performed well in times of military conflict and has climbed more than $40 since before Soleimani’s killing.
In Europe, Germany’s Dax returned 0.6%, France’s CAC 40 added 0.1% and the FTSE 100 in London was virtually flat.
Oil prices gave up some of their recent big gains on Tuesday, with benchmark U.S. crude dropping 41 cents, or 0.7%, to $62.86 per barrel in electronic trading on the New York Mercantile Exchange. It gained 22 cents to $63.27 per barrel on Monday.
TAKE A BREATH: Gold slowed its momentum and rose a modest 80 cents to $1,569.60 per ounce. It had climbed more than $16 each of the last two days as investors piled into what they thought could hold steady even if a war broke out in the Middle East.
Brent crude, the international benchmark, lost 51 cents, or 0.5%, to $68.40 per barrel. On Monday it added 31 cents to $68.91 per barrel.
U.S. officials warned ships about the possibility of Iranaian action against U.S. interests in Mideast waterways or other retaliations following the drone strike on Soleimani.
In currency trading, the dollar rose to 108.45 Japanese yen from 108.33 yen on Monday. The euro slipped to $1.1168 from $1.1194.
SLICKED: Benchmark U.S. crude gave up some of its big gains made in recent days on worries about supplies. It dropped 53 cents to $62.74 per barrel. It had jumped more than $2 per barrel over the last two days.
Apart from waiting for next steps in the clash between the United States and Iran, several big economic reports are on the schedule this upcoming week that could move markets. The headliner is Friday’s jobs report from the government.
Brent crude, the international standard, fell 63 cents to $68.28 per barrel.
Solid jobs growth has helped support the U.S. economy, even as trade wars hurt manufacturing around the world. Economists expect Friday’s report to show that employers added 155,000 jobs last month. The healthy job market is one of the reasons the S&P 500 soared to its second-best showing in 22 years in 2019. Big moves by central banks around the world to shield the economy from the pain of trade wars also were big factors.
That helped put at least a temporary halt to the recent rise for energy stocks. Chevron fell 1.8%, Exxon Mobil lost 1.2% and Schlumberger fell 1.3%.
YIELDS: The yield on the 10-year Treasury held steady at 1.81%.
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AP Business Writer Elaine Kurtenbach contributed.
Copyright 2020 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Copyright 2020 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
